Showing posts with label Safe Haven. Show all posts
Showing posts with label Safe Haven. Show all posts
Tuesday, October 16, 2012
Why Jim Rogers is Long U.S. Dollar
When listening to the wisdom of Jim Rogers over the years, especially as to how the failed policies of the Federal Reserve have debased the U.S. dollar to the point of being valued at over 95 percent less than it was when the Fed was instituted almost 100 years ago, it's surprising to some to hear him say he's long the U.S. dollar.
Rogers continues to be long on gold, but because the U.S. dollar usually goes in the opposite direction, it seems counter intuitive as to the realities connected to the relationship between the U.S. dollar and gold.
Because Rogers believes there will be much more turmoil in the markets going forward, he sees people throwing their money at the U.S. dollar because it is perceived as a place of safety for capital.
But Rogers notes that his being long the dollar has nothing to do with the strength or safety of the dollar, but rather upon the fact that is is perceived to be a place of safety by the vast majority of investors.
So there is no doubt when the chaotic conditions of the market are reflected in the performance thereof, people and institutions will pile into the U.S. dollar, making it appear to be strengthening, even as the failed policies of the Federal Reserve continue to undermine and debase it.
In other words, Rogers is essentially investing in the guaranteed behavior of the stampeding crowd as it relates to the U.S. dollar in uncertain markets, and because of that he can be long gold and the U.S. dollar at the same time, and make money on both.
Thursday, September 23, 2010
How High Can Gold Prices Go During These Times of Market Uncertainty?
The year of 2010 will go down in the history books as a period of financial crisis and uncertainty as markets ponder the direction of future price movements. All eyes have been transfixed on the S&P 500 Index for some indication of what is to come, primarily since most market drivers have settled into direct correlation with the popular index. Gold and the U.S. Dollar, typically inversely correlated, have been dance partners for nearly a year, and have locked on to the S&P 500 index on occasion.
Presently, the stock index has finally broken through its 200-day moving average again, the third time in as many months, but resistance appears to be building as technical indicators signal another overbought condition. Stocks and other correlated market indexes seem to enjoy this sideways motion. Market traders have learned to profit from the predictable swings, but the long-term investor is confused as to where to invest his capital. Invariably, the conclusion reached by many is to invest in Gold where record highs are the norm for this year, as is a continual upward march in bullion values.
Can this trend in Gold prices continue or it just another market aberration brought on by a year of crises and risk-averse capital fleeing to safe havens? For the past decade, Gold has been ramping up in value, unabated by most conditions that have impacted other markets. The recession, whether we are out of it or not, did little to slow down the Gold parade, and its honored status as a “safe haven” has been tested several times in the recent past to no avail. Gold remains impervious to economic data that destroys value on many other fronts.
The following chart provides a longer-term perspective for evaluating present conditions:
This chart suggests that Gold has been in a “recovery” mode for the past decade, making up lost ground on the S&P 500. The price of Gold reached “parity” with the index while the recession was in full bloom and crossed above it in November of last year. Currently, the multiple is 1.12 versus the S&P 500 index, still a bit below the historical average of 1.40. From this perspective, it is easy to argue that Gold has more room to grow
Current Gold prices are due for a slight correction, as buyers and sellers consolidate their positions. Technical indicators, as with the S&P 500, are suggesting that current price levels have run out of momentum, resulting from an overbought status. However, these conditions have occurred four times in the past year, only to be followed by another resurgence in demand.
The surprise for the past year has been that Gold and our greenback have been so tightly entwined together. Traditionally, the two dance partners have been more like oil and water. When one goes down, the other goes up, and vice-versa. The advent of the Euro at the turn of the millennium coincided with Gold’s upward move. As all forex brokers will attest, the “EUR/USD” currency pair bore witness to tradition as the Euro and Gold both strengthened together. That correlation broke down at the beginning of 2010 as concern over debt issues in Europe began to materialize.
If basic correlations have broken down this year, then what are we to believe going forward? A quick review of Gold’s fundamentals may provide the desired insights.
Presently, the stock index has finally broken through its 200-day moving average again, the third time in as many months, but resistance appears to be building as technical indicators signal another overbought condition. Stocks and other correlated market indexes seem to enjoy this sideways motion. Market traders have learned to profit from the predictable swings, but the long-term investor is confused as to where to invest his capital. Invariably, the conclusion reached by many is to invest in Gold where record highs are the norm for this year, as is a continual upward march in bullion values.
Can this trend in Gold prices continue or it just another market aberration brought on by a year of crises and risk-averse capital fleeing to safe havens? For the past decade, Gold has been ramping up in value, unabated by most conditions that have impacted other markets. The recession, whether we are out of it or not, did little to slow down the Gold parade, and its honored status as a “safe haven” has been tested several times in the recent past to no avail. Gold remains impervious to economic data that destroys value on many other fronts.
The following chart provides a longer-term perspective for evaluating present conditions:
This chart suggests that Gold has been in a “recovery” mode for the past decade, making up lost ground on the S&P 500. The price of Gold reached “parity” with the index while the recession was in full bloom and crossed above it in November of last year. Currently, the multiple is 1.12 versus the S&P 500 index, still a bit below the historical average of 1.40. From this perspective, it is easy to argue that Gold has more room to grow
Current Gold prices are due for a slight correction, as buyers and sellers consolidate their positions. Technical indicators, as with the S&P 500, are suggesting that current price levels have run out of momentum, resulting from an overbought status. However, these conditions have occurred four times in the past year, only to be followed by another resurgence in demand.
The surprise for the past year has been that Gold and our greenback have been so tightly entwined together. Traditionally, the two dance partners have been more like oil and water. When one goes down, the other goes up, and vice-versa. The advent of the Euro at the turn of the millennium coincided with Gold’s upward move. As all forex brokers will attest, the “EUR/USD” currency pair bore witness to tradition as the Euro and Gold both strengthened together. That correlation broke down at the beginning of 2010 as concern over debt issues in Europe began to materialize.
If basic correlations have broken down this year, then what are we to believe going forward? A quick review of Gold’s fundamentals may provide the desired insights.
- Intrinsic Value: Investors the world over appreciate the metal’s ability to retain value and continue to view it as a primary safe haven;
- Hedge Against Inflation: As recessionary forces wane and recovery plans take hold, interest rates and inflation will surely follow, if only delayed by central bank fears of a return to negative GDP growth. Gold has always been valued as a perfect hedge against inflation;
- Mining Prospects: Mining interests have had to fight new taxes on their efforts and find new and better extraction methods, but exploration has not suffered, nor discovered any new major deposits;
- Industrial Usage: Demand is predictable in this area and can only increase as economic recovery spreads;
- Current Inventories: Despite fear mongering by Gold critics, central banks have no plan or cause to release their stored reserves. Even if they did, China would gladly exchange their U.S. Dollar CDs for Gold today.
While markets and traders alike ponder the uncertainty of economic conditions, the price of Gold continues to set new records and bolster its decade-long upward trend. While technical indicators signal that a slight pullback in price level is in the cards, the fundamental outlook for Gold remains unshaken by the market’s inability to clearly see the way forward. Gold futures on December delivery have shown slight declines, but these are part of the expected correction in price levels.
Wednesday, August 25, 2010
Eldorado (NYSE:EGO), Barrick (NYSE:ABX), Goldcorp (NYSE:GG) Soar as Investors Flock to Gold
The realization we've never left the recession is starting to be realized by a growing number of investors, and gold miners like Eldorado Gold Corp. (NYSE:EGO), Barrick Gold (NYSE:ABX) and Goldcorp (NYSE:GG) are soaring today as gold prices continue their upward march with investors seeking safety.
Gold prices are approaching two-month highs, up to $1,240, a gain of $10.20, as of 1:15 PM EDT.
Continuing bad news concerning the economy is the major reason for the resumption in gold prices surging upward. As the stimulus money leaves the system the underlying weakness is again in the face of investors who see it did nothing but hide the economic disaster, rather than do anything to help.
And calls for more stimulus have people extremely worried as economic report after economic report, including the plunge in sales of previously-owned homes plunging, and a record low in sales of new homes, which plunged to an annual rate of 276,600, along with a 12.4 percent decline in July.
A report from the Commerce Department also revealed orders for durable goods failed to meet expectations, indicating continued weakness in the manufacturing sector.
Gold prices today show the future pattern, and gold mining companies will be the beneficiaries of this strong move as the disaster the economy really is becomes to be understood more fully by investors, who will increasingly use gold investments as a safe haven.
Gold prices are approaching two-month highs, up to $1,240, a gain of $10.20, as of 1:15 PM EDT.
Continuing bad news concerning the economy is the major reason for the resumption in gold prices surging upward. As the stimulus money leaves the system the underlying weakness is again in the face of investors who see it did nothing but hide the economic disaster, rather than do anything to help.
And calls for more stimulus have people extremely worried as economic report after economic report, including the plunge in sales of previously-owned homes plunging, and a record low in sales of new homes, which plunged to an annual rate of 276,600, along with a 12.4 percent decline in July.
A report from the Commerce Department also revealed orders for durable goods failed to meet expectations, indicating continued weakness in the manufacturing sector.
Gold prices today show the future pattern, and gold mining companies will be the beneficiaries of this strong move as the disaster the economy really is becomes to be understood more fully by investors, who will increasingly use gold investments as a safe haven.
Thursday, August 12, 2010
Goldman (NYSE:GS) Sees Gold Hitting $1,300 in Six Months
The optimism in the global and U.S. economies are plunging again, and gold is there to woo people into safety in response to the perceived and real threat to their capital.
Goldman Sachs (NYSE:GS) sees gold possibly reaching $1,300 an ounce in the next six months, based on the U.S. government's response to the weak economy of entering another phase of quantitative easing (printing money). Another factor is the ongoing interest low interest rates.
Goldman analysts David Greely and Damien Courvalin, wrote in a note to clients, “The recent selloff has left speculative long positions in gold oversold relative to U.S. real interest rates." They feel this has “set the stage for a rally to our six- month gold-price target of $1,300 an ounce.”
The Federal Reserve said this week they're going to use principal payments on mortgage holdings to reinvest into long-term Treasury securities in an attempt to initiate growth.
None of this makes sense, as the hundreds of billions they attempted to use to stimulate the economy has already failed, and to do the same thing over again is futile and a waste of time and money.
Spot gold has shot up $17 as of 3:00 PM EDT, increasing to $1,214.90 an ounce. This will continue to be the gold story as the futile attempts by the government to stimulate the economy undermine the U.S. dollar and drives people to the safe haven of gold.
Goldman Sachs (NYSE:GS) sees gold possibly reaching $1,300 an ounce in the next six months, based on the U.S. government's response to the weak economy of entering another phase of quantitative easing (printing money). Another factor is the ongoing interest low interest rates.
Goldman analysts David Greely and Damien Courvalin, wrote in a note to clients, “The recent selloff has left speculative long positions in gold oversold relative to U.S. real interest rates." They feel this has “set the stage for a rally to our six- month gold-price target of $1,300 an ounce.”
The Federal Reserve said this week they're going to use principal payments on mortgage holdings to reinvest into long-term Treasury securities in an attempt to initiate growth.
None of this makes sense, as the hundreds of billions they attempted to use to stimulate the economy has already failed, and to do the same thing over again is futile and a waste of time and money.
Spot gold has shot up $17 as of 3:00 PM EDT, increasing to $1,214.90 an ounce. This will continue to be the gold story as the futile attempts by the government to stimulate the economy undermine the U.S. dollar and drives people to the safe haven of gold.
Friday, May 14, 2010
European Run on Physical Gold
Europeans have been caught by surprise over the announcement that not only is the EU going to bail out Greece, but they put just under $1 trillion on the table to redistribute to the other socialist countries in the region.
Warnings of the consequences to the euro have went unheeded, and now Europeans are not only pouring money into gold, they're also ordering gold bullion at a pace of demand that can't be met, and already some gold dealers have shut down orders in response to the demand, as they simply can't supply it.
The actions of the EU leaders over the last month just over Greece is part of the problem, as it was highly contested as to whether or not they were going to provide them with a bailout. That seemed to imply it was questionable as to whether or not that was going to happen. And now seemingly out of nowhere the announcement comes they're ready to bail out every country that needs help, or at least says they need help.
This is why so many rushed to gold, as they were caught off guard with now generous the EU was going to be with their money, and how that would drive down the value of the euro, and eventually bring it to an end.
Something stinks in how this has happened, and to abruptly turn around and not only bail out Greece, but offer the type of funds that were offers, seems to imply this may have all been orchestrated by politicians and central bankers over a period of time, as it doesn't really make much sense in how it burst upon the scene the way it did, as if there was this huge, inner battle going on, and suddenly everything is okay, and they'll add an additional $800 billion to the pot for good measure.
If there had really been that much resistance, it's doubtful this is how it would have played out.
It must be understood what is happening here. This really isn't a bail out of the nations, this is a bail out of the banks that bought the bonds of these nations.
What this means is these bankers were supporting these socialist, welfare, entitlement societies for many years, which were created by the politicians to garner favor in order to remain in office, and funded by the outrageous acquisition of debt that had no way of being repaid as it was played out. Now it has come home to roost and is being exposed as the fraud it is.
Next step? American and other westerners are going to be called on again to bail out banks, but this time banks which helped created socialist, entitlement cultures where people believe they deserve to be taken care of for nothing, and unions run by these socialists demanding extraordinary pensions and perks with very little in the way of productivity to pay for them. This is why socialism needs to be completely and totally abandoned, along with Keynesianism, which provides the theoretical and intellectual justification for this type of spending.
For Europeans and other western countries, they're again being asked, no forced, by their governments and central banks to bail out these losers, robbing our children and grandchildren of their inheritance so these others can live the easy live at our expense.
The Federal Reserve is already trying to cover its rear-end by saying they aren't going to provide funds so these socialists can live the good life, rather they're bailing out the banks, who I guess, are still too big to fail. What a nuthouse.
Europeans are starting to understand the threat, and since Germans have had this experience in the past, I'm sure they're leading the way in trying to buy physical gold in order to hold onto their wealth, which is slipping away with the failure of the euro.
Warnings of the consequences to the euro have went unheeded, and now Europeans are not only pouring money into gold, they're also ordering gold bullion at a pace of demand that can't be met, and already some gold dealers have shut down orders in response to the demand, as they simply can't supply it.
The actions of the EU leaders over the last month just over Greece is part of the problem, as it was highly contested as to whether or not they were going to provide them with a bailout. That seemed to imply it was questionable as to whether or not that was going to happen. And now seemingly out of nowhere the announcement comes they're ready to bail out every country that needs help, or at least says they need help.
This is why so many rushed to gold, as they were caught off guard with now generous the EU was going to be with their money, and how that would drive down the value of the euro, and eventually bring it to an end.
Something stinks in how this has happened, and to abruptly turn around and not only bail out Greece, but offer the type of funds that were offers, seems to imply this may have all been orchestrated by politicians and central bankers over a period of time, as it doesn't really make much sense in how it burst upon the scene the way it did, as if there was this huge, inner battle going on, and suddenly everything is okay, and they'll add an additional $800 billion to the pot for good measure.
If there had really been that much resistance, it's doubtful this is how it would have played out.
It must be understood what is happening here. This really isn't a bail out of the nations, this is a bail out of the banks that bought the bonds of these nations.
What this means is these bankers were supporting these socialist, welfare, entitlement societies for many years, which were created by the politicians to garner favor in order to remain in office, and funded by the outrageous acquisition of debt that had no way of being repaid as it was played out. Now it has come home to roost and is being exposed as the fraud it is.
Next step? American and other westerners are going to be called on again to bail out banks, but this time banks which helped created socialist, entitlement cultures where people believe they deserve to be taken care of for nothing, and unions run by these socialists demanding extraordinary pensions and perks with very little in the way of productivity to pay for them. This is why socialism needs to be completely and totally abandoned, along with Keynesianism, which provides the theoretical and intellectual justification for this type of spending.
For Europeans and other western countries, they're again being asked, no forced, by their governments and central banks to bail out these losers, robbing our children and grandchildren of their inheritance so these others can live the easy live at our expense.
The Federal Reserve is already trying to cover its rear-end by saying they aren't going to provide funds so these socialists can live the good life, rather they're bailing out the banks, who I guess, are still too big to fail. What a nuthouse.
Europeans are starting to understand the threat, and since Germans have had this experience in the past, I'm sure they're leading the way in trying to buy physical gold in order to hold onto their wealth, which is slipping away with the failure of the euro.
Wednesday, May 12, 2010
Citigroup (NYSE:C) On Canadian Dollar
The Canadian dollar will regain parity with the U.S. dollar, according to Citigroup (NYSE:C), and should find support in the range of 1.0207 to 1.0225.
In a note to clients, Citigroup said in the short-term the Canadian dollar should reach 0.9931.
Last week's market turmoil brought the loonie down, but that won't last long, as the fundamentals are too strong to keep it at those levels.
The Canadian dollar is increasingly being thought of as a safe haven investment, as the economy of Canada remains strong, and they are positioned for a profitable and long run because of the natural resources available in the country, and the strong demand for those resources from China and other areas of the world, which will go on for many years.
The Canadian dollar will rise with the economic growth of the country, and with little or no sovereign debt issues, is being eyed by investors as an alternative to the U.S. dollar, along with gold.
In a note to clients, Citigroup said in the short-term the Canadian dollar should reach 0.9931.
Last week's market turmoil brought the loonie down, but that won't last long, as the fundamentals are too strong to keep it at those levels.
The Canadian dollar is increasingly being thought of as a safe haven investment, as the economy of Canada remains strong, and they are positioned for a profitable and long run because of the natural resources available in the country, and the strong demand for those resources from China and other areas of the world, which will go on for many years.
The Canadian dollar will rise with the economic growth of the country, and with little or no sovereign debt issues, is being eyed by investors as an alternative to the U.S. dollar, along with gold.
Tuesday, April 27, 2010
Investors Flee to Gold for Safety
Gold prices moved higher today as investors fled to safety after the S&P downgraded Greece and Portugal, with Greece debt now being classified as junk and Portugal debt being downgraded two levels.
While ongoing opposing possibilities continue to weigh on gold, for now it seems things will continue to support gold prices, and they'll continue their upward move.
The major event waiting on the sidelines is the increase in interest rates by the federal reserve, which they've said isn't going to happen any time soon. But investor will listen closely as usual to any hint concerns over inflation could cause that to change.
While ongoing opposing possibilities continue to weigh on gold, for now it seems things will continue to support gold prices, and they'll continue their upward move.
The major event waiting on the sidelines is the increase in interest rates by the federal reserve, which they've said isn't going to happen any time soon. But investor will listen closely as usual to any hint concerns over inflation could cause that to change.
Tuesday, March 16, 2010
Barrick Gold (ABX.TO), Potash (POT.TO) Push TSX Up
Toronto Stock Exchange Up on Rising Commodity Prices
Rising commodity prices drove up the Toronto Stock Exchange today to its highest level since September 2008, led by majors like Barrick Gold (ABX.TO) and Potash (POT.TO).
This is the third straight day the index has finished the session above 12,000.
Gold mining giant Barrick Gold (ABX.TO) closed the day at $40.64, while Potash (POT.TO) endd the session at $128.75. Potash was moved by reports their inventory may have dropped.
Barrick Gold and other similar companies were moved partly by the anticipation of interest rates in the U.S. remaining the same, and the Federal Reserve confirmed this after their meeting, possibly signaling another upward move of gold as everything is lining up to favor the inflation hedge and safety currency for investors.
Toronto Stock Exchange Up on Rising Commodity Prices
Rising commodity prices drove up the Toronto Stock Exchange today to its highest level since September 2008, led by majors like Barrick Gold (ABX.TO) and Potash (POT.TO).
This is the third straight day the index has finished the session above 12,000.
Gold mining giant Barrick Gold (ABX.TO) closed the day at $40.64, while Potash (POT.TO) endd the session at $128.75. Potash was moved by reports their inventory may have dropped.
Barrick Gold and other similar companies were moved partly by the anticipation of interest rates in the U.S. remaining the same, and the Federal Reserve confirmed this after their meeting, possibly signaling another upward move of gold as everything is lining up to favor the inflation hedge and safety currency for investors.
Toronto Stock Exchange Up on Rising Commodity Prices
Tuesday, January 20, 2009
Gold Investment Digest Report: World Gold Council on Gold Performance in 2008
Gold Investment Digest Report from the World Gold Council on gold performance for 2008 and looking ahead to 2009
NEW YORK & LONDON - (Business Wire) Gold proved its metal in 2008, according to World Gold Council’s latest Gold Investment Digest, providing a safe haven and long term store of value for investors in record volume and outperforming many other assets in relative price and volatility terms.
Despite one of the most tumultuous years in financial markets since the Great Depression, gold ended the year on a firm footing recording its eighth consecutive annual price increase. The last three months of 2008 was a quarter of two halves. While distressed gold sales by some institutional investors meeting margin calls on other assets had a dampening effect on price in the first few weeks of the final quarter, by mid November broader recognition that the dire financial situation was likely to endure for some time, fears about the credit system and future inflationary impact of shifts in monetary policy and the dollar resuming its secular decline led gold to rally by around $150/oz. Gold, therefore, closed the year at US$869.75.oz, up 4% from the same period in 20071.
Gold price volatility remained high by historical standards at the end of the year, at 37% (gold’s long-run price volatility is around 12.5%), although still below most other asset classes. However, underpinned by robust and diverse market fundamentals, gold traded in a tighter range than other financial assets, major world indices and most other commodities.
“Gold’s performance over the year is impressive considering the massive wealth destruction that took place elsewhere in financial and commodities markets,” said Natalie Dempster, Head of Investment, North America for World Gold Council. “Impacted to a lesser extent by the financial crisis, which affected equities, and declining industrial demand, which affected physical assets, gold outperformed global equities and all major commodities during 2008.”
During the final quarter, investors turned to physical-backed gold ETFs in large numbers, buying 96 tonnes of incremental gold via exchange trade funds. December recorded the strongest monthly inflow into gold ETFs, with investors buying 44 tonnes of gold. Investment in gold ETFs, monitored by the World Gold Council, now stands at around US$33 billion2.
“As investors became increasingly concerned by the state of the economy during the course of the year, they turned to gold as a store of value. Within the third and fourth quarters of 2008, inflows into gold ETFs reached record levels as investors were motivated by gold’s lack of counterparty risk and the opportunity to hold a real, physical asset,” Dempster said. “As we move into 2009, continued uncertainty over the financial landscape, combined with future inflationary fears resulting from interest rates cuts and quantitative easing by central banks, are likely to pique investor interest in gold further.”
Gold Investment Digest, a concise and comprehensive analysis of investment trends and economic indicators that influence investment interest in and the demand for gold, can be downloaded at www.gold.org. Users will need to register, which is free of charge. At the same address, users can access a range of investment statistics, which we have completely overhauled to extend the country coverage and make the materials easier to download. For further information, or should you like to learn more about investment in gold, please contact:
Notes to Editors:
World Gold Council
World Gold Council (WGC), a commercially-driven marketing organization, is funded by the world’s leading gold mining companies. A global advocate for gold, WGC aims to promote the demand for gold in all its forms through marketing activities in major international markets. For further information visit www.gold.org.
Conclusion:
The Gold Investment Digest Report from the World Gold Council points out the performance of gold for 2008 versus other investments, while looking ahead to what 2009 holds for the yellow metal.
NEW YORK & LONDON - (Business Wire) Gold proved its metal in 2008, according to World Gold Council’s latest Gold Investment Digest, providing a safe haven and long term store of value for investors in record volume and outperforming many other assets in relative price and volatility terms.
Despite one of the most tumultuous years in financial markets since the Great Depression, gold ended the year on a firm footing recording its eighth consecutive annual price increase. The last three months of 2008 was a quarter of two halves. While distressed gold sales by some institutional investors meeting margin calls on other assets had a dampening effect on price in the first few weeks of the final quarter, by mid November broader recognition that the dire financial situation was likely to endure for some time, fears about the credit system and future inflationary impact of shifts in monetary policy and the dollar resuming its secular decline led gold to rally by around $150/oz. Gold, therefore, closed the year at US$869.75.oz, up 4% from the same period in 20071.
Gold price volatility remained high by historical standards at the end of the year, at 37% (gold’s long-run price volatility is around 12.5%), although still below most other asset classes. However, underpinned by robust and diverse market fundamentals, gold traded in a tighter range than other financial assets, major world indices and most other commodities.
“Gold’s performance over the year is impressive considering the massive wealth destruction that took place elsewhere in financial and commodities markets,” said Natalie Dempster, Head of Investment, North America for World Gold Council. “Impacted to a lesser extent by the financial crisis, which affected equities, and declining industrial demand, which affected physical assets, gold outperformed global equities and all major commodities during 2008.”
During the final quarter, investors turned to physical-backed gold ETFs in large numbers, buying 96 tonnes of incremental gold via exchange trade funds. December recorded the strongest monthly inflow into gold ETFs, with investors buying 44 tonnes of gold. Investment in gold ETFs, monitored by the World Gold Council, now stands at around US$33 billion2.
“As investors became increasingly concerned by the state of the economy during the course of the year, they turned to gold as a store of value. Within the third and fourth quarters of 2008, inflows into gold ETFs reached record levels as investors were motivated by gold’s lack of counterparty risk and the opportunity to hold a real, physical asset,” Dempster said. “As we move into 2009, continued uncertainty over the financial landscape, combined with future inflationary fears resulting from interest rates cuts and quantitative easing by central banks, are likely to pique investor interest in gold further.”
Gold Investment Digest, a concise and comprehensive analysis of investment trends and economic indicators that influence investment interest in and the demand for gold, can be downloaded at www.gold.org. Users will need to register, which is free of charge. At the same address, users can access a range of investment statistics, which we have completely overhauled to extend the country coverage and make the materials easier to download. For further information, or should you like to learn more about investment in gold, please contact:
Notes to Editors:
World Gold Council
World Gold Council (WGC), a commercially-driven marketing organization, is funded by the world’s leading gold mining companies. A global advocate for gold, WGC aims to promote the demand for gold in all its forms through marketing activities in major international markets. For further information visit www.gold.org.
Conclusion:
The Gold Investment Digest Report from the World Gold Council points out the performance of gold for 2008 versus other investments, while looking ahead to what 2009 holds for the yellow metal.
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